GM lost money because factories in the United States, as well as some in Canada and Mexico, were idling during the walkout. The strike directly affected 31 GM factories and 21 other facilities, spread across nine states, mostly in the center of the country.
The cost of the strike in the last two weeks of the third quarter was just under $ 750 million. GM will account for the rest of the loss this quarter, as it estimates the total loss will come to around $ 2 per share, the company said Tuesday.
GM was able to make a profit of $ 2.3 billion in the third quarter, despite strikes and sales of $ 31
Although GM was unable to build any cars at US factories during the strike, it had built up a list of vehicles ahead of the walkout to give dealers access to the cars and trucks they needed to continue selling.
However, when GM plants come back to work, "without extra vehicles in the pipeline for many weeks, our dealership inventories will be temporarily slimmer than we will," says CEO Mary Barra.
Although GM is making every effort to restore the supply of vehicles to normal levels, Barra said it will be difficult to make up for six weeks of lost production, especially for the best-selling vehicles, including pickups and SUVs. GM's truck plant is already running around the clock.
"It is difficult to add overtime on top of overtime," said CFO Dhivya Suryadevara. "So we want to restore every device we possibly can. It's only hard to predict at this time what it will look like."
GM insisted that the four-year agreement reached with the United Auto Workers union is a good one.
"Our new employment agreement maintains our competitiveness, retains our flexibility and allows us to continue to improve our quality and productivity," said Barra. And she predicted that GM could find cost savings and productivity improvements over the next few years to cover the increased labor costs under the deal.